Kent County commissioners consider dissolving Land Bank

GRAND RAPIDS — The Kent County Board of Commissioners is considering dissolving its agreement with the Kent County Land Bank Authority.

Commissioners are expected to vote to withdraw from an intergovernmental agreement between the Michigan Land Bank Fast Track Authority and the county treasurer during their Dec. 20 meeting. The county’s finance committee recommended the move based on input from stakeholders and the region’s improved real estate market. It also recommended giving the Land Bank a 12-month window to resolve current projects and agreements.

“Several” commissioners expressed concerns about the authority’s work, according to a staff report. The report noted concern that the Land Bank competes with private industry through its relationship Champion Homes Inc. on a modular homes initiative, as well as questions over whether the authority met its initial objectives. Others questioned if the Land Bank was still necessary given the improved real estate market since its founding in 2011.

A subcommittee made up of commissioners previously had reviewed the Lank Bank in 2016. In 2018, staff from the county administrator’s office conducted an “implementation review” by interviewing stakeholders — including members of an advisory council, Land Bank members and staff and some business owners in the community, said County Administrator Wayman Britt — to see if recommendations from the subcommittee had been met.

In the 2018 report, staff found the Land Bank should increase transparency and handle scheduling issues and consult the authority’s advisory council in advance of decision making. Staff also wrote the Land Bank’s work outside of the county “appears to take the focus off Kent County.” Another concern focused on tax revenue associated with parcels handled by the Land Bank.

David Allen, executive director of the Land Bank, referred MiBiz to Ken Parrish, the county treasurer who would be instructed to dissolve the agreement. Parrish also serves as chair of the Kent County Land Bank Authority.

Parrish said some of the concerns in the staff review were valid, but none outweigh the community need for the Land Bank. He added that some projects could be in jeopardy with a dissolution of the authority, including a housing project with LINC Up called West Garfield that recently secured low-income housing tax credits and a project with Dwelling Place, among others.

“There are many not-for-profit and for-profit developers who are going to no longer have many of the tools that the Land Bank offers available to them,” he said. “It will be a hardship for many organizations in our community.”

In June, the Land Bank rebranded as Innova-Lab, partnering with Champion Homes, a Troy-based modular home manufacturer, to begin developing modular homes on more than 100 vacant sites it owns in the Grand Rapids area, as MiBiz previously reported.

After that, other communities in Michigan began reaching out to the Lank Bank about “InnovaHomes.”

Although the report cited the Land Bank’s work outside of Kent County as a concern, Parrish said the authority just was offering advice “on a subject we happen to have some expertise in.”

“We’re not buying or owning or selling any real estate,” he said. “We’re simply advising, but we will certainly take a look at that if there are better ways for us to handle that.”

In July, Allen said the pivot to developing manufactured housing aligned with the Land Bank’s overall mission of economic development and having available affordable housing. For the Land Bank, the shift came partly out of necessity as the number of foreclosed properties declined as the economy improved.

Still, Allen said at the time that the Land Bank, which continued to own about 125 parcels as of July, still fills a vital community role in cleaning up messy titles.

A community impact assessment presented in 2017 by the Michigan State University Land Policy Institute showed the Land Bank had generated $43 million in economic impact in four years, and created 266 new jobs.

The Kent County Land Bank has generated about $2.9 million revenue in 2018, according to financials posted on its website. Of that total, $2.4 million came from sale of assets, while about $338,000 came from tax captures.

Despite some concerns, the county board lacks the mechanism to mandate its recommendations be followed by the Land Bank, according to the subcommittee report.

At the meeting on Thursday, commissioners could vote to pass a resolution that requires Parrish to withdraw from the intergovernmental agreement. They also could postpone considering the measure or vote down the resolution.

If the agreement is terminated, the land bank would conclude its operations. The move also would not prevent Kent County from establishing a new land bank in the future.

The Kent County Land Bank Authority was created in 2009 through an intergovernmental agreement between the Michigan Land Bank Fast Track Authority and the Kent County Treasurer. It began operations in 2011.

--Editor’s note: This story has been updated from its original version.